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22 December 2015

City AM: Leaving the EU is the only way Britain can regain control of its economic destiny

The author argues that a Brexit is the only way to regain UK's economic control, and burst a hole in the centralising 'dam' the EU represents.

Economic freedom is a good proxy for broad economic success. And in many regards, the EU plays a positive role in constraining governments from impinging freedoms – whether it be the movement of goods, services, people, or capital. This has led some, such as the Adam Smith Institute’s Sam Bowman, to question whether there really is an economically liberal economic case for Brexit – especially if the one major consequence of coming out is a migration clampdown.
Bowman is right that the issues most of the media obsess about are small fry. Our membership of the EU should not be decided on the trivial matter of in-work benefits to migrants. There will also probably be much focus on the gross (£18bn) and net (£9bn) contributions Britain makes to the EU budget each year. Although, outside the EU, we would be able to better shape much of this (gross) spending to domestic priorities, we would likely continue to pay for many existing programmes or remain signed up to EU ones (which also makes europhile scaremongering here redundant). [...]
And the most important consideration from an economic liberal’s perspective is the nature of the EU’s institutions and their direction of travel.
The EU’s authority over economic areas has been used to regulate more and more activity. This has two negative consequences. First, it erodes Britain’s independent representation on global bodies which determine the most important regulations and standards. Second, in areas where regulation is more appropriate at a local level, it entrenches centralised and irreversible regulations in Brussels. This prevents experimentation and competition, embeds systemic risks and, by being undertaken further from democratic scrutiny, is more open to capture by interest groups.
Sadly, the UK is so entrenched in this system that it will take years to unpick it – meaning that leaving should be seen as more of a process than a one-off event, as argued by Richard North in the Flexcit publication. [...]
But leaving at least allows the possibility for change across many areas. It affords us the opportunity to create institutional responsiveness to a fast-moving global environment, allows us to target new trade broadening arrangements with fast-growing areas, and to regain our voice in global fora. Staying in, on the other hand, looks like a one-way bet to more centralisation: ceding control over areas better delivered locally and losing independent global influence, while exacerbating the feeling of domestic democratic powerlessness. So the only way to regain economic control, and burst a hole in the centralising dam, is to vote to leave.

© City A.M.

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